05 Feb

Legislature has a chance to deflect brutal November showdown

Last week Oregon produced a dramatic lesson, relevant not only where it happened, but clear across the state:

If you keep saying you’re ready for a violent showdown, you just might get it.

After two weeks of waving around guns and vowing to stand up to the feds to the end – and seriously creeping out the local residents that they claimed to be defending – the leaders of the Malheur occupation were taken by surprise and arrested by the FBI, and one of them was killed.

No matter what kind of warlike challenges he’d been issuing, it could not be considered a successful outcome for him.

Nobody in Salem, where the Legislature starts its off-year short session Monday, is brandishing high-powered rifles and declaring a willingness to stay there for months. But the state is heading for its own high-casualty showdown this fall, and every sign from the legislature shows a willingness to let it happen.

This November, Oregon is facing an explosive ballot, with two measures to increase the minimum wage – to $13.50 and $15 – along with IP28, a massive new gross receipts tax on businesses doing more than $25 million in business in Oregon. The measure would bring in $5 billion a biennium, increasing the state’s general fund by almost a third.

The projected battle this fall may be beyond anything automatic weapons can produce.

The legislature can’t keep anything off the ballot; that’s the whole point of initiatives. But it does have options.

“I’d rather see the legislature put an alternative on the ballot,” said Senate Majority Leader Ginny Burdick, D-Portland, in an interview last week. “We have a history of putting on moderate alternatives to carry the day.”

On the minimum wage, there is the prospect of an alternative. Gov. Kate Brown is offering an alternative plan, a sizable increase spread over six years, that might form a basis for a legislative approach.
But on the revenue issue, it’s hard to see an alternative path emerging.

“So far business and labor are not interested,” said Burdick. “They want to fight it out.”

The last time they got to fight it out was in 2010, over the business and upper-income tax increases Measures 66 and 67, which to some surprise passed – and it’s hard to imagine what Oregon schools would be like now if they hadn’t. That example encourages the sponsors of IP28, along with the prospect of a large presidential year turnout, and a considerable range of unions and other organizations supporting the measure and prepared to back a major campaign for passage.

There’s also the reality that Oregon’s schools and services are dramatically underfunded, and that the state has some of the lowest business taxes in the country.

On the other hand, IP28 is a considerably larger tax increase than Measure 66 and 67 together, and the campaign against it is likely to be larger and considerably more bitter than the earlier battle – which is still remembered painfully across the state. And neither Measure 66 nor Measure 67 passed by much – nor did the last publicly voted minimum wage increase in 2002.

There is no certainty of anything passing, and Oregon showing up in 2017 with no new revenue is an alarming prospect.

Monday, Sen. Mark Hass, D-Beaverton, chairman of the Senate Finance and Revenue Committee, presents his own proposal –also a gross receipts tax, bringing in much less money, about $1 billion a biennium. Hass sees it as an effort to “avoid this terribly nasty campaign ahead.”

Nobody thinks that the legislature could assemble an entire alternative revenue program in the 35 days of the short session. But it’s a while until July, and if the legislature made progress on an idea, it could return in the spring to finish. Even that might be implausible, as Republicans opposed to any tax increase and House Democrats backing IP28 might together create an impassible barrier to any effort to defuse the showdown.

“The business community is not interested. The unions are not interested. They both think they can win it,” Senate President Peter Courtney said Wednesday. “There will be a total civil war.”

Previously, Courtney forecast a rerun of Antietam, the bloodiest battle of the Civil War.

But at least Antietam had a winner.

So as the legislature meets, both sides are looking for a showdown to the finish. As we saw in eastern Oregon last week, if that’s what you call for, that may be what you get.

But it may not be the finish you want.

NOTE: This column appeared in The Sunday Oregonian, 1/31/16.

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